Seven Months After Maduro's Fall, Big Oil Still Won't Commit To Venezuela
- Seven months after Maduro's removal, Exxon and Chevron still haven't signed major new investment deals in Venezuela.
- Venezuela's oil output has climbed to 1.07 million barrels per day, up from 937,000 last year, but remains far below its late-1990s peak.
- With majors staying cautious, the Trump administration is leaning on smaller independent producers to move faster and supply capital.
Venezuela's long-awaited oil revival has been slower than many in Washington anticipated, according to the Wall Street Journal.
Seven months after Nicolás Maduro's removal, negotiations between the interim government and major U.S. energy companies remain bogged down, with no landmark investment deals despite the country's vast crude reserves.
Rather than rushing back into the country, firms such as ExxonMobil and Chevron are taking a cautious approach. Executives remain wary of Venezuela's history of nationalizing foreign assets, unresolved compensation disputes dating back to the Chávez era, and lingering political uncertainty. As Francisco Monaldi of Rice University's Baker Institute put it, "They have been burned twice," making boards reluctant to approve multibillion-dollar projects unless the opportunity is exceptionally attractive.
WSJ writes that competition has also complicated negotiations. Several companies are pursuing the same high-quality assets in the Orinoco Belt and Monagas state while pressing for more favorable tax, regulatory, and ownership terms. According to José Ignacio Hernández of Aurora Macro Strategies, enthusiasm has yet to translate into commitments: "You have a very successful open house with 100 people attending, but then nobody calls."
Chevron has continued expanding production through operational improvements, lifting output to nearly 300,000 barrels per day, but it has stopped short of committing fresh billions to new developments. Exxon has reportedly scaled back some of its interest after failing to secure enough of the assets it wanted and facing enormous costs to rehabilitate previously nationalized infrastructure.
Venezuela's oil production has climbed to roughly 1.07 million barrels per day, up from about 937,000 last year, but it remains a fraction of the country's late-1990s peak. With the majors proceeding cautiously, the Trump administration has increasingly looked to smaller independent producers that can move faster and provide immediate capital. Several privately held firms have already signed preliminary agreements, though analysts caution that fully developing Venezuela's heavy-oil resources will ultimately require the deep pockets, long investment horizons, and technical expertise that only the largest international oil companies can provide.
